This blog is brought to you by Niraj Ranjan Rout, founder of collaboration software company, Hiver.

A startup’s flat hierarchy often means employees have to self-monitor their performance and there is usually no hawk-eyed manager watching your every step. But judging your performance objectively can be hard and such judgements can be quite distorted too.

This is why setting a system to help employees to objectively monitor their own performance can be quite helpful. The OKR system is a great option here. It will help define and track objectives within a company, especially on an individual level.

What are OKRs?

OKR stands for Objectives and Key Results. They're used by Google to measure team progress towards objectives. But they're increasingly popular in other businesses too. 

OKRs consist of a list of 3-5 high-level objectives.

Under each objective then usually 3-5 key measurable results are listed. Each key result has a progress indicator or score of 0-100% or 0 to 1.0 that shows its achievement.

An effective OKR answers two questions:

  • What do I want to accomplish? (Objective)
  • How will I measure my degree of success? (Key Results)

So typically, a simplified OKR, as said by John Doerr, would look like:

‘ I want to accomplish ______ measured by ________’

OKRs should be tied in to your overall business plan or business strategy.

If you decided that you want to follow Google’s footsteps and implement OKRs to encourage growth and progress at your startup - but you don’t know where to start-  here are some practical tips from my own experience.

1. Stick to a 7:3 ratio

To implement OKR successfully in your startup, it is critical that your employees play the major part in setting objectives.

At least 70% of the OKRs should come from employees and only 30% from the founder.

If the management starts imposing OKRs on the employees, they will consider it as a hassle and less like a tool for self-improvement. Thereby defeating the whole purpose of OKRs!

For instance, at my startup, Hiver, I and my co-founder give the employees a broad picture of what we want to accomplish in the next couple of months and then leave it to the team and the individuals to set the individual objectives and key results.

While we play the major role in setting the company level OKRs, we mostly leave the employee level OKRs to the employees. I have seen that this gives the employees a sense of belonging and responsibility towards their goals.

2. Make sure the results are visible

OKRs need to serve as a guide for the work day and the work week. So, making OKRs an everyday ritual can seriously help. Whether you place a big bulletin board on your office wall, or use spreadsheets or collaboration tools, it is crucial that your employees see them regularly.

At Hiver, we use Google Sheets for this purpose. Using a spreadsheet can get a little overwhelming. But, if you know how to use it properly, things will be a lot easier. You will be able to seamlessly manage and track your employees from a centralized tool that is simple, flexible and easily accessible. Ultimately, you will end up saving a lot of money, as you won’t have to buy a dedicated a project management tool.

Coming to the implementation part, normally, I insist that my employees update their progress as frequently as possible, at least once every 3 days. Again, this is not exactly for the management to keep an eye on each employee every day, this is more of a reminder to your employees on how they are doing.

I make sure to regularly print these OKR results and pin them on our bulletin board for everyone to see. I think this fosters healthy competition and can act as a gentle reminder for people who are slacking.

3. Keep the process very simple

Tedious and heavy documentation is going to make OKRs more of a hassle than a help to your teammates.

The process should not take more than a couple of minutes. Also, the simpler it is, the easier it is to draw insights from the OKR. If it is a messy collection of graphs, stats and what not, it will be hard for you and your team to analyze them.

Let’s say for example, that you want to set OKR for your email marketing team:

  1. Set the objective - in this case, to increase the number of conversions through email marketing.
  2. Set key results towards that end - you can have one or more indicators, in this case, let’s consider click-through rate.
  3. Track the results - use a spreadsheet, for example, to track your click-through average for each newsletter you send, or you can invest in an analytics tool.

Defining and tracking OKRs should be this simple!

4. Aim for gradual growth

If this is your first time implementing OKRs, don’t overreach. For example, start with something as small as achieving only 40% (or even less) of your OKRs for the first 2-3 weeks and then slowly raise the bar.

OKR is not just a simple piece of paper to be filled at the end of the day, it calls for a complete shift in the very way your employees have been working and evaluating themselves. Hence, don’t expect it to take off well the very first time. You are going to hit snags and accordingly keep modifying or revising them.

Remember that understanding the theory of OKRs is way easier than successfully implementing them.

5. Track them

Although I did say that the management should not get overly involved in setting the OKRs, that doesn’t necessarily mean that you leave them completely untracked.

It is healthy to keep checking in every few months to understand how your workforce is doing. For example, when we initially launched OKRs we noticed that  most of our employees were not meeting their numbers. The reason was that we were setting lofty goals for ourselves. We realized this mistake when we decided to assign one person to track all the OKRs.

Keeping your OKRs aspirational is fine, but it has to be realistic too.

Summing up...

Adopting OKRs is a sensible way to add structure to your startup without compromising on flexibility. OKRs tell an employee what to do but not how to do it. Through OKRs you are really only giving employees a way to track themselves. You can still keep an eye on the employee’s performance and jump in only when things get out of hand.

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